AUGUSTA, Maine — Maine’s congressional delegation all voted for the American Recovery and Reinvestment Act, but all are doubtful a second stimulus bill would make it through Congress, and whether one is needed.
“We still do not have all the answers to how the TARP [Troubled Asset Relief Program] money has been spent and whether it is effective,” said Sen. Olympia Snowe, R-Maine. “I don’t see Congress voting for additional recovery funds until we have the accountability and transparency for the money already appropriated.”
Snowe acknowledged TARP was passed under the Bush administration, but said those funds are part of the overall recovery effort that is now close to $4 trillion in spending over a couple of years.
“The stimulus package really has yet to take hold,” she said. “So I don’t see how we can assess whether we need another one, at least not in the near term. I don’t believe that Congress right now has the appetite to do any additional megatrillion-dollar packages.”
Snowe said there has been controversy among economists who have testified before the Senate Finance Committee on how much federal help is needed to stimulate the economy. Some have indicated a larger package is needed, but others urged caution. She said she believes the $787 billion package, coupled with TARP funds and actions by the Federal Reserve, should be enough to stimulate the economy.
Rep. Chellie Pingree, D-Maine, agreed. She said as a first-term member of Congress, voting on the recovery package was a tough initiation.
“I think that we are all hoping that we are seeing the beginnings of the stimulus package and the budget doing its work,” she said, “Here in Maine we have started construction jobs, we have started to see the money flow.”
Pingree said there have been more questions from reporters about a second stimulus package than discussion of the subject among members of Congress. But, she said, if later in the year it appears the stimulus measures are not working, she believes Congress will look at additional measures.
“It is premature right now to try and predict what the economy will be like six months from now,” said Sen. Susan Collins, R-Maine. “A year ago, who would have thought we would be heading towards the worst economic times since the Great Depression?”
She said a second stimulus package is not warranted now, and that the only support she has heard voiced for an additional package is among House Democrats led by Speaker Nancy Pelosi, D-Calif. But, Collins said, if the economy has not responded to stimulus programs by the start of 2010, lawmakers will have to consider additional measures.
Collins also expects that the federal budget, both a supplemental for this year and the fiscal year 2010 budget, will include additional spending that will have an impact on the economy.
“I don’t see a lot of support in the House, and certainly not among the Blue Dogs,” said Rep. Michael Michaud, D-Maine. “We have to see how the first one has done, and we are still seeing rules being promulgated for much of the spending.”
He said the Blue Dog caucus of more fiscally conservative House Democrats was reluctant to go along with some of the provisions in the first stimulus package. He said the deficit spending to spur the economy is funded by borrowing that eventually will have to be paid back.
“I do think there are some spending measures we will have to do this year, like unemployment benefits and food stamps,” he said.
Congress passed emergency unemployment benefits last fall and created an extended benefits program in the Recovery Act, but those additional programs will end this summer. With unemployment continuing to increase in most states, including Maine, members of the Maine delegation agree with Michaud that some limited stimulus spending may be needed before year’s end.
“If unemployment continues, and it certainly appears to be continuing to increase, we will have to extend benefits again,” Snowe said. “We have to keep the safety net programs in place as the economy recovers.”
Pingree said another safety net program that may need further expansion is the additional Medicaid aid provided the states.
Collins agreed it is likely unemployment benefits will need to be addressed this summer, but she said all of the stimulus programs have ending dates for a reason. They are designed to stimulate the private sector and are not supposed to be ongoing programs.